CHANGE IN CONTROL COMPENSATION AGREEMENT
This Change in Control Compensation Agreement ("Agreement") is entered
into as of the first day of July 1, 1997 by and between FEATHER RIVER STATE
BANK, a California banking corporation ("Bank"), CALIFORNIA INDEPENDENT
BANCORP, a California corporation ("CIB") (collectively referred to herein as
"Employer"), and XXXXXX X. XXXXXX ("Executive").
Whereas, Executive has been employed by the Bank since March 1, 1980, and
CIB since May 2, 1995. Executive currently serves as president and chief
executive officer of the Bank and CIB; and
Whereas, the Board of Directors of the Bank and CIB recognize Executive's
contribution to both entities along with his experience, training and ability
in the financial institution industry; and
Whereas the Board of Directors of the Bank and CIB consider it to be in
the best interest of the Bank and CIB to assure the continuation of
Executive's employment in an executive capacity and to compensate Executive
therefor; and
Whereas, Executive is desirous of committing to serve Employer on the
terms provided herein:
NOW, THEREFORE, Employer and Executive agree as follows:
1. TERM AND OPERATION OF AGREEMENT. Subject to the provisions for
termination as hereinafter provided, the term of this Agreement shall
commence on the date hereof and shall continue in effect through July 2,
1998; PROVIDED, HOWEVER, that commencing on July 3, 1998 and each July 1
thereafter, the term of this Agreement shall automatically be extended for
one additional year unless not later than March 30 of the preceding year,
either party shall have given written notice that it does not wish to extend
this Agreement; and PROVIDED, FURTHER, that notwithstanding any such notice
by Employer not to extend, this Agreement shall continue in effect for a
period of thirty (30) months beyond the term provided herein if a "Change in
Control" of the Company (as hereinafter defined) shall have occurred during
such term.
2. POSITION; SCOPE OF EMPLOYMENT. Executive is employed as the
President and Chief Executive Officer of Bank and Bancorp and shall perform
the customary duties of a person in that position with a California financial
institution and such other duties as may, from time to time, be reasonably
requested of him by the boards of directors of either Employer.
2.1. ENTIRE TIME AND EFFORT. Executive shall devote Executive's
best efforts and such time and attention to the business of Employer as shall
be necessary to perform Executive's duties and advance the best interest of
Employer, and shall not, during the term of this Agreement, directly or
indirectly, alone or as a member of a partnership, or as an officer, director
or shareholder of any corporation (other than any which are owned by or
affiliated with Employer) be engaged in any other business activity, whether
or not such business activity is pursued for gaining profit or other
pecuniary advantage, without the approval of Employer; but this shall not be
construed as preventing Executive from (i) investing Executive's assets in
such form or manner as will not require any services on the part of Executive
in the operation of the affairs of the companies in which such investments
are made, (ii) serving on the boards of directors of companies other than
Employer and its affiliates, and/or (iii) engaging in public service and
volunteer activities as long as they do not unreasonably interfere
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with the performance of Executive's duties as set forth in this Agreement.
In addition, Employer shall provide Executive with such executive perquisites
as shall be determined from time to time by the Board or the proper committee
of the Board.
2.2. RULES AND REGULATIONS. Executive agrees to observe and comply
with Employer's rules and regulations as may be amended from time to time by
Employer, and will carry out and faithfully perform such orders, directions
and policies of Employer.
2.3. PLACE OF PERFORMANCE. In connection with Executive's
employment by Employer, Executive shall be based at Employer's principal
executive offices and shall not be required to be absent therefrom on travel
status or otherwise an excessive or unreasonable amount of time in the
aggregate in any calendar year. Employer shall not, without the written
consent of Executive, relocate or transfer its principal executive offices to
a location other than at the headquarters of a major segment of Employer's
business. Employer will promptly pay (or reimburse Executive for) all
reasonable moving expenses incurred by Executive relating to a change of
Executive's principal residence in connection with any such relocation of
Employer's principal executive offices, and will indemnify Executive against
any loss realized (a) in the sale of Executive's principal residence in
connection with any such change of residence (including, without limitation,
(i) the difference, if any, between the fair market value of such residence,
as determined by a licensed real estate appraiser, and the amount actually
realized in the sale thereof, and (ii) the difference, if any, between the
amount realized from the sale of the residence and the cost (including
financing costs) of comparable housing at the new location), or (b) in the
termination of lease pertaining to Executive's principal residence (including
the difference, if any, between the amount of rent paid pursuant to the lease
so terminated and that which would be paid for comparable housing at the new
location). In no event shall the amount payable to Executive for moving
expenses and loss realized in connection with a change in Executive's
principal residence relating to a relocation of Employer's principal
executive offices be less than the amount Executive would otherwise be
entitled to receive under Employer's then existing policy relating to
executive relocations.
3. FRINGE BENEFITS. The compensation provided for under this Agreement
due to the change in control of Employer is granted as a fringe benefit to
Executive and does not affect, amend, or modify any of Executive's rights or
obligations under any benefit, pension or compensation plan, Executive stock
ownership plan, savings and profit sharing plan, stock option plan, life
insurance plan, medical insurance plan or health-and-accident plan in which
Executive is participating, or in which Executive is entitled to participate,
at the effective date hereof (or plans providing Executive with substantially
similar benefits), including but not limited to his Executive Salary
Continuation Plan with the Bank dated April 28, 1993, his Executive Salary
Continuation Plan with the Bank dated February 4, 1997 (collectively, the
"Salary Continuation Plans"), the 1996 and 1997 Bonus Plans (collectively,
the "Incentive Compensation Plans"), the 0000 Xxxxxxx Xxxxx Xxxxx Bank
Employee Stock Ownership Plan, California Independent Bancorp 1989 Amended
and Restated Stock Option Plan and the California Independent Bancorp 1996
Stock Option Plan (collectively, the "Stock Option Plans" and, together with
the Salary Continuation Plans and Incentive Compensation Plans, the "Employer
Plans").
4. TERMINATION.
4.1. Executive's employment with Employer may be terminated prior
to the expiration of the term of this Agreement, upon any of the following
events:
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4.1.1. The written agreement of Employer and Executive;
4.1.2. Executive's death or disability;
4.1.3. By Employer for cause;
4.1.4. By Executive for good reason;
4.1.5. By Executive without good reason;
4.1.6. By Executive upon a change in control of Employer;
4.1.7. By either party at the option of either party and
without prejudice to any other remedy to which either party may be entitled
at law, in equity or under this Agreement, if either party:
(a) Files a petition in bankruptcy court or is adjudicated a bankrupt;
(b) Institutes or suffers to be instituted against him any procedure in
bankruptcy court for reorganization or rearrangement of his financial affairs;
(c) Has a receiver of his assets or property appointed because of
insolvency; or
(d) Makes a general assignment for the benefit of creditors.
4.2. TERMINATION BASED ON STATUTORY GROUNDS. This Agreement shall
terminate immediately upon the occurrence of any of the following events,
which events are described in sections 2290 and 2921 of the California Labor
Code:
(a) The occurrence of circumstances that make it impossible or
impractical for the business of Employer to be continued;
(b) The death of Executive;
(c) The loss of Executive of legal capacity. This does not affect
Executive's rights under Paragraph 6.3 of this Agreement;
(d) The loss by Employer of legal capacity to contract;
(e) The continued incapacity on the part of Executive under this
Agreement, unless waived by Employer; or
(f) The willful or permanent breach by Executive of the obligations
owed to Employer.
4.3. DEFINITION OF DISABILITY. Termination by this Agreement based
on Executive's "Disability" shall mean termination because of Executive's
inability, either for a period exceeding sixty (60) consecutive days or for
ninety (90) days accumulated during one (1) year, as determined by a
qualified physician, and which qualifies Executive for benefits under
Employer's long-term disability
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policy, to perform in the usual manner the material duties usually and
customarily pertaining to Executive's long-term employment, unless within
thirty (30) days after Notice of Termination (as hereinafter defined) is
given following such absence Executive shall have returned to the full time
performance of Executive's duties.
4.4. DEFINITION OF CAUSE. Any of the following shall constitute
"Cause" to terminate this Agreement: (i) willful or habitual breach of
Executive's duties; (ii) fraud, including intentional material
misrepresentation or concealment, by Executive to Employer or any others;
(iii) theft or conversion by Executive; (iv) unauthorized disclosure or other
use of Employer's trade secrets, customer lists or confidential information;
(v) habitual misuse of alcohol or any nonprescribed drug or intoxicant; (vi)
the willful engaging by Executive in conduct which is demonstrably and
materially injurious to Employer, monetarily or otherwise; (vii) willful
violation of any other standards of conduct as set forth in Employer's
Executive Manual; (viii) incompetence; (ix) breach of fiduciary duty
involving personal profit; (x) material breach of any of the terms of this
Agreement; (xi) willful or negligent violation of any law (other than minor
traffic violations or similar offenses), rule, regulation, cease-and-desist
order or any other regulatory order or agreement Employer enters into with
their banking regulatory agencies. In addition, Employer reserves the right
to terminate this Agreement "for cause" in the event that any formal or
informal actions are brought by any regulatory agency having jurisdiction to
remove or suspend Executive from office, whether or not such actions have
become final.
Termination by Employer of Executive's employment for "Cause" shall
mean termination upon any of the events constituting "Cause" as defined above
(other than any such events resulting from Executive's incapacity due to
physical or mental illness or from Executive's termination for Good Reason),
after a demand for substantial performance is delivered to Executive by the
Board which specifically identifies the manner in which the Board believes
that Executive has not substantially performed Executive's duties. For
purposes of this paragraph, no act, or failure to act, on Executive's part
shall be considered "willful" unless done, or omitted to be done, by
Executive not in good faith and without reasonable belief that Executive's
action or omission was in the best interest of Employer.
4.5. DEFINITION OF GOOD REASON. "Good Reason" shall mean, without
Executive's express written consent, any of the following:
4.5.1. The assignment to Executive of any duties
inconsistent with Executive's position, duties and status with Employer
immediately prior to a Change in Control of Employer; a substantial
alteration in the nature or status of Executive's authority or
responsibilities from those in effect immediately prior to a Change in
Control of Employer; the failure to provide Executive with substantially the
same perquisites which Executive had immediately prior to a Change in Control
of Employer, including but not limited to an office and appropriate support
services; or a change in Executive's titles or offices as in effect
immediately prior to a Change in Control of Employer, or any removal of
Executive from or any failure to re-elect Executive to any of such positions;
4.5.2. A reduction by Employer in Executive's Base Salary as
in effect on the effective date of this Agreement or as the same may be
increased from time to time;
4.5.3. Employer's requiring Executive to be based anywhere
other than the metropolitan area in which Executive's office is located at
the effective date of this Agreement, except
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for required travel on Employer's business to an extent substantially
consistent with Executive's present business travel obligation;
4.5.4. The failure by Employer to continue in effect any
Employer Plan; the taking of any action by Employer which would adversely
affect Executive's participation in or materially reduce Executive's benefit
under any of such plans or deprive Executive of any material fringe benefit
enjoyed by Executive, or to which Executive is entitled, at the effective
date of this Agreement; or the failure by Employer to provide Executive with
the number of paid vacation days to which Executive is entitled on the basis
of years of service with Employer in accordance with Employer's normal
vacation policy in effect on the date hereof; or
4.5.5. The failure by Employer to obtain the assumption of
the agreement to perform this Agreement by any successor as contemplated in
Section 6 hereof
4.6. DEFINITION OF CHANGE IN CONTROL. For purposes of this
Agreement, a "Change in Control of Employer" shall mean (i) the sale,
transfer or other exchange of the voting securities of either the Bank or CIB
which would result in the ownership or control by any individual or entity of
40% or more of any class of voting security of the Bank or CIB; (ii) any
transaction which results in the Bank or CIB being merged or consolidated
with another financial institution or corporation that results in less than
60% of resultant bank or corporation's outstanding voting securities being
owned in the aggregate by the former shareholders of the Bank or CIB; (iii)
any transaction which results in the Bank or CIB substantially selling all of
its assets to another financial institution or corporation which is not a
wholly owned subsidiary or corporate affiliate of the Bank or CIB; or (iv)
during any period of twenty-four (24) consecutive months, at least a majority
of the board of directors of either the Bank or CIB ceases to consist of the
same individuals who have served continuously on the respective Board since
the beginning of such period or whose election, or nomination for election by
the respective shareholders, were approved by a vote of at least two-thirds
of the directors then still in office who have served continuously on the
respective Board since the beginning of the period.
4.7. NOTICE OF TERMINATION. Any purported termination by Employer
or by Executive for Good Reason, shall be communicated by written Notice of
Termination to Employer hereto in accordance with Section 7 hereof. For
purposes of this Agreement, a "Notice of Termination" shall mean a notice
which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of Executive's
employment under the provision so indicated.
4.8. DATE OF TERMINATION. "Date of Termination" shall mean (i) if
Executive's employment is terminated as a result of Executive's death, the
date of death; (ii) if Executive's employment is terminated for Disability,
thirty (30) days after Notice of Termination is given (provided that
Executive shall not have returned to the performance of Executive's duties on
a full-time basis during such thirty (30) day period); and (iii) if
Executive's employment is terminated for any other reason, the date specified
in the Notice of Termination (which, in the case of a termination by Employer
for Cause shall not be less than thirty (30) days, and in the case of a
termination by Executive for Good Reason shall not be more than sixty (60)
days, from the date such Notice of Termination is given); provided that if
within thirty (30) days after any Notice of Termination is given the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be the date
on which the dispute is finally determined, either by mutual written
agreement of the parties, by a binding and final arbitration award or by a
final
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judgment, order or decree of a court of competent jurisdiction (the time for
appeal therefrom having expired and no appeal having been perfected); and
provided further that the Date of Termination shall be extended by a notice
of dispute only if such notice is given in good faith and the party giving
such notice pursues the resolution of such dispute with reasonable diligence.
5. COMPENSATION UPON TERMINATION.
5.1. COMPENSATION FOLLOWING TERMINATION BASED ON EXECUTIVE'S DEATH,
EXECUTIVE'S DISABILITY, EXECUTIVE'S RESIGNATION OTHER THAN FOR GOOD REASON,
BY EMPLOYER FOR CAUSE, OR UPON AGREEMENT OF THE PARTIES. If this Agreement
is terminated due to Executive's Death, or Executive's Disability, or
Executive's resignation during the term of this Agreement for other than Good
Reason, or Employer terminated this Agreement for Cause, or by written
agreement between the parties, Employer shall have no further obligation to
Executive to pay any compensation under this Agreement, except as may
otherwise be provided by such written agreement.
5.2. TERMINATION FOLLOWING EXECUTIVE'S RESIGNATION FOR GOOD REASON
PRIOR TO A CHANGE IN CONTROL. Executive shall be entitled to terminate
Executive's employment for Good Reason, and in the event that such a
termination occurs prior to a Change in Control, Employer shall have no
further obligation to Executive to pay any compensation under this Agreement.
Executive's right to terminate Executive's employment pursuant to this
paragraph shall not be affected by Executive's incapacity due to physical or
mental illness.
5.3. TERMINATION FOLLOWING EXECUTIVE'S RESIGNATION FOR GOOD REASON
FOLLOWING A CHANGE IN CONTROL. Executive shall be entitled to terminate
Executive's employment for Good Reason, and in the event that such a
termination occurs following a Change in Control, Executive shall be entitled
to the benefits provided in Section 5.4 below. Executive's right to
terminate Executive's employment pursuant to this paragraph shall not be
affected by Executive's incapacity due to physical or mental illness.
5.4. TERMINATION FOLLOWING A CHANGE IN CONTROL. If any of the
events described in Paragraph 4.6 hereof constituting a Change in Control of
Employer shall have occurred, Executive shall be entitled to the benefits
provided in this Section 5.4 upon the subsequent termination of Executive's
employment during the term of this Agreement unless such termination is (i)
because of Executive's death or Disability, (ii) by Employer for Cause, or
(iii) by Executive other than for Good Reason.
5.4.1. Employer shall pay Executive's full base salary
through the Date of Termination at the rate in effect at the time Notice of
Termination is given;
5.4.2. In lieu of any further salary payments to Executive
for periods subsequent to the Date of Termination, Employer shall pay as
severance pay to Executive, not later than the fifth day following the Date
of Termination, a lump sum severance payment (together with the payments
provided in Paragraphs 5.4.3 and 5.4.4, the "Severance Payments") equal to
two and one-half (21/2) times the sum of (a) Executive's annual base salary
at the highest rate in effect during the year immediately preceding the
occurrence of the circumstances giving rise to the Notice of Termination
given in respect thereof, and (b) the amount of any bonus paid to Executive
and the amount paid to Executive pursuant to the Incentive Compensation Plans
during the year immediately preceding that in which the Date of Termination
occurs;
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5.4.3. Notwithstanding any provision of the Incentive
Compensation Plans, Employer shall pay to Executive in one lump sum in cash
not later than the fifth day following the Date of Termination, an amount
equal to the sum of (A) any incentive compensation which has been allocated
for the fiscal year preceding that in which the Date of Termination occurs
but has not yet been paid, and (B) any award under the Incentive Compensation
Plans which has not yet been paid for any period which has closed prior to
the Date of Termination, and (C) a pro rata portion of the aggregate value of
all contingent awards to Executive for all uncompleted periods under the
Incentive Compensation Plans calculated by multiplying for each such award,
(1) a fraction the numerator of which shall be the number of full months
elapsed during the period for such award prior to the Date of Termination,
and the denominator of which shall be the total number of months contained in
such period, by (2) the amount of the award which would have been payable to
Executive following completion of such period at the "fully competent" (or
comparable) level of performance as described in the plan documents and the
individual objective development worksheets.
5.4.4. In lieu of shares of common stock of CIB (the
"Shares") issuable upon the exercise of options ("Options"), if any, granted
to Executive under the Stock Option plans (which Options shall be canceled
upon the making of the payment referred to below in this section 5.4.4),
Executive shall receive in one lump sum in cash not later than the fifth day
following the Date of Termination an amount equal to the difference between
the cumulative exercise price of the Options and the higher of (a) the NASDAQ
closing price of CIB stock on the Date of Termination; and (b) the actual
price per share paid in connection with a change of control.
5.4.5. In the event that any payment or benefit received or
to be received by Executive in connection with a Change in Control of
Employer or the termination of Executive's employment, whether payable
pursuant to the terms of this Agreement or any other plan, arrangement or
agreement with Employer, its successors, any person whose actions result in a
Change in Control or any corporation ("Affiliate") affiliated (or which as a
result of the completion of the transactions causing a Change in Control will
become affiliated) with the Employer within the meaning of section 1504 of
the Internal Revenue Code of 1986, as amended (the "Code") (collectively with
the Severance Payments, "Total Payments") would not be deductible (in whole
or part) by Employer, an Affiliate or other person making such payment or
providing such benefit, as a result of section 280G of the Code, the
Severance Payments shall be reduced until no portion of the Total Payments is
not deductible as a result of section 280G of the Code, or the Severance
Payments are reduced to zero. For purposes of this limitation (A) no portion
of the Total Payments the receipt or enjoyment of which Executive shall have
effectively waived in writing prior to the date of payment of the Severance
Payments shall be taken into account; (B) no portion of the Total Payments
shall be taken into account which in the opinion of tax counsel selected by
Employer's independent auditors and acceptable to Executive does not
constitute a "parachute payment" within the meaning of section 280G(b)(2) of
the Code; (C) the Severance Payments shall be reduced only to the extent
necessary so that the Total Payments (other than those referred to in clauses
(A) or (B)) in their entirety constitute reasonable compensation for services
actually rendered within the meaning of section 280G(b)(4) of the Code, in
the opinion of the tax counsel referred to in clause (B); and (D) the value
of any non-cash benefit or any deferred payment or benefit included in the
Total Payments shall be determined by Employer's independent auditors in
accordance with the principles of sections 280G(d)(3) and (4) of the Code; and
5.4.6. Unless Executive is terminated for Cause, Employer
shall maintain or cause to be maintained in full force and effect, for
Executive's continued benefit, for a period of thirty (30) months, all health
and welfare benefit plans to include life insurance, health insurance and
dental
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insurance, in which Executive participated or was entitled to participate
immediately prior to the Date of Termination, provided that Executive's
continued participation is possible under the general terms and provisions of
such plans and programs. In the event that Executive's participation in any
such plan or program is barred, Employer shall arrange to provide Executive
with benefits substantially similar to those which Executive is entitled to
receive under such plans and programs. At the end of such thirty (30) month
period, Executive will be entitled to take advantage of any conversion
privileges applicable to the benefits available under any such plans or
programs.
5.5. In the event that Executive is terminated due to a Change in
Control, the Executive shall not be required to mitigate the amount of any
payment provided for in this Section 5 by seeking other employment or
otherwise, nor shall the amount of any payment provided for in this Section 5
be reduced by any compensation earned by Executive as the result of
employment by another employer after the Date of Termination.
5.6. The allocation between Bank and CIB for their respective share
of Executive's compensation under this Agreement shall be determined by the
Bank's board of directors, in its sole discretion.
6. SUCCESSORS: BINDING AGREEMENT.
6.1. Employer will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of Employer, by agreement in
form and substance satisfactory to Executive, to expressly assume and agree
to perform this Agreement in the same manner and to the same extent that
Employer would be required to perform it if no succession had taken place.
Failure of Employer to obtain such agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle
Executive to compensation from Employer in the same amount and on the same
terms as Executive would be entitled to hereunder if Executive terminated
Executive's employment for Good Reason, except that for purposes of
implementing the foregoing, the date on which any such succession becomes
effective shall be deemed the Date of Termination. As used in this Agreement,
the "Employer" shall mean Employer as hereinbefore defined and any successor
to its business and/or assets as aforesaid which executes and delivers the
agreement provided for in this section 6 or which otherwise becomes bound by
all the terms and provisions of this Agreement by operation of law, or
otherwise.
6.2. This Agreement and all rights of Executive hereunder shall
inure to the benefit of and be enforceable by Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devises and legatees. If Executive should die while any amounts would still
be payable to Executive hereunder if Executive had continued to live, all
such amounts, unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to Executive's devisee, legatee, or other
designee or, if there be no such designee, to Executive's estate.
7. NOTICES. Any notice under this Agreement shall be in writing, and
any written notice or other document shall be deemed to have been duly given
(i) on the date of personal service on the parties, (ii) on the third
business day after mailing, if the document is mailed by registered or
certified mail, (iii) one day after being sent by professional or overnight
courier or messenger service guaranteeing one-day delivery, with receipt
confirmed by the courier, or (iv) on the date of transmission if sent by
telegram, telex, telecopy or other means of electronic transmission resulting
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in written copies, with receipt confirmed. Any such notice shall be
delivered or addressed to the parties at the addresses set forth below or at
the most recent address specified by the addressee through written notice
under this provision. Failure to give notice in accordance with any of the
foregoing methods shall not defeat the effectiveness of notice actually
received by the addressee.
8. RESOLUTION OF DISPUTES AND WAIVER OF JURY TRIAL.
8.1. DEFINITION OF DISPUTES. Any and all claims or controversies
arising out of, relating to, or pertaining to this Agreement, Employer Plans,
or the breach thereof ("dispute") shall be resolved as provided in this
paragraph. The parties agree that no party shall have the right to xxx any
other party regarding a dispute except as provided in this paragraph. The
parties further agree, to the fullest extent permitted by law, that each
party waives any right to a trial by jury in any action, proceeding or
counterclaim of any kind arising out of, relating to, or pertaining to this
Agreement or the Employer Plans.
8.2. BINDING ARBITRATION. Any dispute between the parties shall be
submitted to, and be conclusively determined by, binding arbitration in
accordance with this paragraph. The provisions of this paragraph shall not
preclude any party from seeking injunctive or other provisional or equitable
relief in order to preserve the status quo of the parties pending resolution
of the dispute, and the filing of an action seeking injunctive or other
provisional relief shall not be construed as a waiver of that party's
arbitration rights. Any party seeking such relief, must immediately file a
motion for preliminary injunction and following a determination of the
motion, the action shall be stayed pending completion of the arbitration.
8.3. SELECTION OF ARBITRATOR(S). The parties shall endeavor in
good faith to select a single arbitrator. If they fail to do so within ten
(10) days of the notice demanding arbitration, each party shall have an
additional period of ten (10) days in which to appoint an arbitrator and
those arbitrators within ten (10 ) days shall select an additional
arbitrator. If any party fails to appoint an arbitrator or if the
arbitrators initially selected by the parties fail to appoint an additional
arbitrator within the time specified herein, any party may apply to have an
arbitrator appointed for the party who has failed to appoint, or to have the
additional arbitrator appointed in accordance with California Code of Civil
Procedure section 1281.6.
8.4. LOCATION OF ARBITRATION. Any arbitration hearing shall be
conducted in Sacramento County, California.
8.5. APPLICABLE LAW. The law applicable to the arbitration of any
dispute shall be the law of the State of California, excluding its conflicts
of law rules, its rules of civil procedure (unless otherwise incorporated in
this paragraph) and its laws of evidence.
8.6. ARBITRATION PROCEDURES. Except as otherwise provided in this
paragraph, the arbitration shall be governed by the following:
(a) The parties shall submit to the arbitration all written,
documentary or other evidence and oral testimony as is reasonably necessary
for a proper resolution of the dispute. Copies of all written submittals
shall be provided to the arbitrator(s) and all parties. Neither party shall
be entitled to conduct discovery, and the discovery provisions in California
Civil Code of Procedure sections 1283.1 and 1283.05 are waived. The
arbitrator(s) shall conduct such hearings as they
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consider necessary, may require the submission of briefs or points and
authorities and may submit written questions to the parties. The parties
shall respond to such questions in writing. If a question is addressed to an
individual or fewer than all parties, copies of the question and the answer
thereto shall be served on the other parties.
(b) At the hearing, any relevant evidence may be presented by any
party, and the formal rules of evidence applicable to judicial proceedings
shall not govern. Evidence may be admitted or excluded in the sole
discretion of the arbitrator(s). Except as provided above, the arbitration
procedures set forth in the California Arbitration Act (Code Civ. Proc.,
Section 1282 et seq.) shall apply to the arbitration.
(c) The arbitration shall proceed with due dispatch and a decision
shall be rendered within sixty (60 ) days after the appointment of the final
arbitrator. Such decision shall be in such written form that a judgment may
be entered on it in any court of competent jurisdiction in the State of
California. Any decision of the arbitrators shall be subject to the
limitations set forth in paragraph 8.7.
8.7. LIMITATION ON SCOPE OF ARBITRATORS' AWARD OR DECISION. The
arbitrators' decision shall pertain and be limited to the claims submitted to
the arbitrators in the demand for arbitration. The arbitrators award may be
reviewed by the appropriate superior and appellate courts for errors in law.
Such errors in law would not include the arbitrator(s)' rulings concerning
procedural or evidentiary matters, but may only be a review of errors in
application of the substantive law at issue in the dispute.
8.8. COSTS OF ARBITRATION. Each party shall pay the costs of the
arbitrator chosen by it and the losing party shall bear all other costs of
arbitration.
8.9. ACKNOWLEDGMENT OF CONSENT TO ARBITRATION. NOTICE: BY
EXECUTING THIS AGREEMENT YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF
THE MATTERS INCLUDED IN THE "ARBITRATION" PROVISION DECIDED BY NEUTRAL
ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS
YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY
EXECUTING THIS AGREEMENT, YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY
AND APPEAL UNLESS SUCH RIGHTS ARE SPECIFICALLY INCLUDED IN THE "ARBITRATION"
PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS
PROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE
CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR EXECUTION OF THIS AGREEMENT
INDICATING YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.
BY INITIALING IN THE SPACE BELOW, YOU ARE INDICATING THAT YOU HAVE READ
AND UNDERSTOOD THE FOREGOING AND UNDERSTAND THAT BY EXECUTING THIS AGREEMENT
YOU AGREE TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THIS
ARBITRATION PROVISION TO NEUTRAL ARBITRATION.
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INITIALS OF CIB'S AUTHORIZED REPRESENTATIVE:
---------
INITIALS OF THE BANK'S AUTHORIZED REPRESENTATIVE:
---------
INITIALS OF EXECUTIVE:
---------
9. ACTIONS CONTRARY TO LAW. Nothing contained in this Agreement shall
be construed to require the commission of any act contrary to law, and
whenever there is any conflict between any provision of this Agreement and
any statute, law, ordinance, or regulation, contrary to which the parties
have no legal right to contract, then the latter shall prevail; but in such
event, the provisions of this Agreement so affected shall be curtailed and
limited only to the extent necessary to bring it within legal requirements.
10. ATTORNEYS' FEES; PREJUDGMENT INTEREST. If the services of an
attorney are required by any party to secure the performance of this
Agreement or otherwise upon the breach or default of another party to this
Agreement, or if any judicial remedy or arbitration is necessary to enforce
or interpret any provision of this Agreement or the rights and duties of any
person in relation thereto, the prevailing party shall be entitled to
reasonable attorneys' fees, costs and other expenses, in addition to any
other relief to which such party may be entitled. Any award of damages
following judicial remedy or arbitration as a result of the breach of this
Agreement or any of its provisions shall include an award of prejudgment
interest from the date of the breach at the maximum amount of interest
allowed by law. If the services of an attorney are required by any party to
secure the performance of this Agreement or otherwise upon the breach or
default of another party to this Agreement, or if any judicial remedy or
arbitration is necessary to enforce or interpret any provision of this
Agreement or the rights and duties of any person in relation thereto, the
prevailing party shall be entitled to reasonable attorneys' fees, costs and
other expenses, in addition to any other relief to which such party may be
entitled. Any award of damages following judicial remedy or arbitration as a
result of the breach of this Agreement or any of its provisions shall include
an award of prejudgment interest from the date of the breach at the maximum
amount of interest allowed by law.
11. CHOICE OF LAW, JURISDICTION, VENUE. This Agreement is drawn to be
effective in the State of California, and shall be construed in accordance
with California law, excluding its conflict of laws rules. The exclusive
jurisdiction and venue of any legal action by either party or arbitration
under this Agreement shall be the County of Sacramento, California.
12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.
13. AMENDMENT. The provisions of this Agreement may be modified at any
time by agreement of the parties. Any such agreement hereafter made shall be
ineffective to modify this Agreement in any respect unless in writing and
signed by the parties against whom enforcement of the modification or
discharge is sought.
14. WAIVER. Any of the terms or conditions of this Agreement may be
waived at any time by the party entitled to the benefit thereof, but no such
waiver shall affect or impair the right of the waiving party to require
observance, performance or satisfaction either of that term or condition as
it applies on a subsequent occasion or of any other term or condition.
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15. NONASSIGNABILITY. This Agreement shall not be assigned by any
party without the prior written consent of the other parties. Any assignment
contrary to the provisions of this Agreement shall be deemed a default under
the Agreement, allowing the nondefaulting parties to exercise all remedies
available under law.
16. NO ATTACHMENT. Except as required by law, no right to receive
payments under this Agreement shall be subject to anticipation, commutation,
alienation, sale, assignment, encumbrance, charge, pledge or hypothecation or
to execution, attachment, levy or similar process or assignment by operation
of law, and any attempt, voluntary or involuntary, to effect any such action
shall be null, void and of no effect.
17. INDEPENDENT COVENANTS. All provisions herein concerning unfair
competition and confidentiality shall be deemed independent covenants and
shall be enforceable without regard to any breach by Employer unless such
breach by Employer is willful and reckless.
18. ENTIRE AGREEMENT. This Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto with
respect to the employment of Employee by Employer and contains all of the
covenants and agreements between the parties with respect to such employment
in any manner whatsoever. Each party to this Agreement acknowledges that no
representations, inducements, promises or agreements, orally or otherwise,
have been made by any party, or anyone acting on behalf of any party, which
are not embodied herein, and that no other agreement, statement or promise
not contained in this Agreement shall be valid and binding. Any modification
of this Agreement will be effective only if it is in writing signed by the
party to be charged.
19. SUCCESSION. Subject to the provisions otherwise contained in this
Agreement, this Agreement shall inure to the benefit of and be binding on the
successors and assigns of Employer.
20. SEVERABILITY. If any provision of this Agreement is held by a
court of competent jurisdiction to be invalid or unenforceable, the remainder
of the Agreement which can be given effect without the invalid provision
shall continue in full force and effect and shall in no way be impaired or
invalidated.
21. CAPTIONS. All paragraph captions are for reference only and shall
not be considered in construing this Agreement.
22. AMBIGUITIES. The Agreement has been negotiated at arm's length
between persons sophisticated and knowledgeable in the matters dealt with
herein. Each party has cooperated and participated in the drafting and
preparation of this Agreement. Any rule of law, including, without
limitation, Civil Code Section 1654, or legal decision that would require
interpretation of any ambiguities in this Agreement against the drafting
party is not applicable and is waived. The provisions of this Agreement
shall be interpreted in a reasonable manner to effect the purpose of the
parties. In the interpretation of this Agreement or any of its terms, both
parties shall be construed to be equally responsible for the drafting and
preparation of the same.
23. ADVICE OF LEGAL COUNSEL. Each party to this Agreement has
consulted with, or had the opportunity to consult with, legal counsel
concerning all paragraphs of this Agreement. Each party has read this
Agreement, and has been fully advised by legal counsel with respect to the
rights and
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obligations under the Agreement, or has had the opportunity to obtain such
advice. Each party is fully aware of the intent and legal effect of the
Agreement, and has not been influenced to any extent whatsoever by any
representation or consideration other than as stated herein. After
consultation with and advice from, or the opportunity for consultation with
and advice from, legal counsel, each and every party voluntarily enters into
this Agreement.
24. NOT A CONTRACT OF EMPLOYMENT. This Agreement shall not be deemed
to be a contract of employment between the parties, nor shall any provision
restrict the right of Employer to discharge Executive,or restrict the right
of Executive to terminate his employment.
25. BANKING REGULATORY AGENCIES. The obligations and rights of the
parties hereunder are expressly conditioned upon the approval or
non-disapproval of (i) this Agreement, and/or (ii) Executive, in the event
such approvals are required, by those banking regulatory agencies which have
jurisdiction over Employer.
FEATHER RIVER STATE BANK:
-------------------------------------------------
(By:___________________________)
Address:________________________
_______________________________
CALIFORNIA INDEPENDENT BANCORP:
-------------------------------------------------
(By:___________________________)
Address:________________________
_______________________________
Executive:
-------------------------------------------------
(Xxxxxx X. Xxxxxx)
Address:________________________
_______________________________
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